“Recent reports that Canada’s economic demise is imminent as a result of the acquisitions by foreign firms of Canadian-bred companies are misleading,” said Ian Russell, president and CEO of the Investment Industry Association of Canada at an Economic Club of Toronto luncheon held today in Toronto.

“The degree of activity in the global marketplace has not been bad for Canada so far. We have held our own on the global stage: the dollar value of our exports has increased by almost 8% since 2001. China’s demands for our industrial raw materials have pushed up world prices for our commodities. Canadian GDP has grown at 3% in the past four years. The ratio of Canadian firms acquiring versus being acquired is almost 3:1,” said Russell.

“Competition from developing nations has, to a large extent, driven our economy and Canada has benefited from globalization, however, there are nonetheless early signs that our ability to compete may be threatened,” Russell added.

According to Russell, Canada’s current problems have not been created by globalization, but because we do not have strong enough internal or regulatory incentives for growing our businesses.

To promote economic growth and support competitive strength, the head of the IIAC outlined a six-point plan:

  1. A favourable tax environment – we must reform the tax system to encourage increased capital formation, especially for smaller businesses.
  2. Better trade policies. Globalization requires policies with a worldview.
  3. Clear and consistent decision-making – how government implements the policies is just as important as which policies are implemented.
  4. A national securities regulator – the federal and provincial governments need to work together to lower the regulatory burden in capital markets, and improve our competitiveness.
  5. A principle-based – not rules-based regulatory system that facilitates efficient markets while ensuring fairness.
  6. A commitment to productivity.

“We must now put in place the policies to encourage competitiveness in the new global environment,” said Russell.